Chippewa Tribe's Credit Union Expected to Open in August

One of the largest employers in northern Michigan is about to open a credit union.

No, it's not an auto manufacturer or a supplier. It's the Saginaw Chippewa Indian Tribe, which received NCUA approval in May for Chippewa Eagle Federal Credit Union in Mt. Pleasant. CEFCU was chartered to serve tribal members and employees, giving it a potential membership of 7,800.

At a time when Michigan is battling record high unemployment, members of the Chippewa tribe have enjoyed income from casinos in Mt. Pleasant and Standish. Actual revenue figures are only released to tribal members, but according to calculations by the Bay City Times, the tribe's profits were $17 million for the first three months after the Standish casino opened in 2008.

The credit union, expected to open in August, will be located in a retail plaza on the same property as the Mt. Pleasant casino, which welcomed its first customer in 1993.

"There's a tremendous amount of interest among the tribal membership," Frank Cloutier, the tribe's public relations director, said. "The credit union board is putting together standards and a marketing strategy.

"The biggest challenge was getting members of the tribe acclimated to the idea we could have a lending institution that was cognizant of their culture and aware of their challenges and struggles in the past. It's been a matter of instilling trust, because for so many years the lending institutions weren't always cooperative and forthcoming."

CEFCU expects to initially offer share accounts, club accounts, money market shares, share certificates and checking, expanding its menu over the next year or two to include credit cards, IRAs and member business accounts.

The CU might also add residential mortgages, meeting some special needs. It's sometimes been difficult for tribal members to obtain mortgages because homes on tribal land can only be sold to tribal members, which restricts a lender's options in foreclosure.

Cloutier said the credit union is intended to fit the tribe's culture and specific needs.

"There is a growing need to have a financial institution that understands the culture of our people," he said. "These people of means now haven't always been in that position. Because of that...they may not have the strongest credit history."

However, even in the current economy, Cloutier said, the casinos have remained profitable and the tribe has no debts.

"The benefits of building a stronger community, including a community-based financial institution, add to that positive picture," he said.

While many credit unions have switched to community charters or added a long list of SEGs to expand membership, such moves appear somewhat unlikely-but not impossible-for CEFCU.

"The credit union is very much focused on the tribe and associates," Cloutier said. "But if there was more potential growth and development, then I'm sure the credit union board would look down that path, do their due diligence, and come up with a marketing strategy."